It would not be far wrong to say that the problem of understanding change
has been around since man first started thinking about what change was and
how it worked. From the time of the ancients to the present day change has
been topical. On the one hand, there is the battle cry of many change consultants
that all is in flux and that change is the only constant. This was the basis
of Heraclitean philosophy. It was given a firm kick in the pants by Plato
some time ago. On the other, there is the lucre subtle Pythagorian thinking
that "man is the measure of all things" that reality as it
appears to one man is as close to the truth as it is to any other reality.
Such thinking permeates the work of many writers; these attempts to understand
change are really a concern with, in some way, influencing the change process
through decision making and action.
At one level it is clear that even if you take no decisions and do nothing,
change will take place. Of course, not necessarily the way you want it to.
At another level there are decisions and actions that fall within a limited
pattern of accepted thinking and behaviour. Often when we discuss and take
decisions about change we have in mind incremental change. Incremental change
is seen to be part of the process of rational thinking and planning. Incremental
change assumes the ability to revert and possibly to find different paths
for change.
Then there is a level where incremental change is not possible, where
change is discontinuous with the past, where the process becomes irreversible,
where control is often tenuous, where revolutionary change is taking place
and involves thinking and behaving in different ways. Decision making becomes
complicated because the change conditions create an out-of-context problem
(OCP).
Out-of-Context Problem
Imagine how villagers in the New World were contented with their lives
before the European explorers arrived. Everything they had learned about
their environment told them how things should be the technology they
used, the structure of their community, the knowledge and power of their
leaders. Imagine the difficulty of coping with the new arrivals, with their
huge ships, their guns, their strange clothes, they were as if from another
planet. Here was an OCP. Nothing has prepared you for an OCP. What village
structure is appropriate, do the chiefs still have power over the villagers,
do the traditional rituals and beliefs still hold?
The Technology of Change
Is there any difference between those villagers and organisations that
are being privatized and having to compete with foreign competitors? Is
there any difference between those villagers and businesses facing onslaught
from global businesses and having to go global in order to stay in business?
These conditions create OCPs. And we are poorly prepared for OCPs because
all of our development has been contextual, we train managers and we create
organisational cultures that are contextual, they survive through coping
with a recognisable context. It's the OCP which leaves them in turmoil.
It is the decisions around these OCPs which are going to ensure survival
or demise.
Usually, in the standard response to a serious OCP we initially see little
by way of creativity. Many change decisions fall into almost a ritualistic
formula and do not go beyond this.
This occurs because managers have learnt a series of responses which
can clearly be identified as the "technology of change" an
invisible technology which is learned in contextual situations and applied
without revaluation of the context or consequences. Using the standard "technology
of change" means being guided by knowledge acquired in different circumstances,
which are similar but not the same. Those companies that have been through
the cycle of applying "technology of change" solutions several
times know the feeling of a rat on a treadmill running like crazy to get
nowhere or, at least, to stay within sight of the competition.
Creative versus controlled Revolutions
British Airways is a much quoted prototype for change. It exemplified
for many how a creative revolution should be implemented and maintained.
With privatisation and later deregulation threatening permanent discontinuous
change BA seemed to be able to motivate its staff to greater levels of creativity.
Unlike SAS the Scandinavian airline which had received much publicity
during the early change process but seemed to run out of steam needed for
sustainibility, BA appeared to have got the formula right. However a change
of leadership and management in the organisation has led to recent problems
ranging from unhappy personnel (with unusually high levels of absenteeism),
unhappy shareholders (with the new logo and livery), and unhappy passengers
(with declining service levels).
All of this suggests that sustainability in the long term is one of the
hardest things to get right. In essence BA management has moved its personnel
from involvement in a creative revolution to a position of controlled revolution.
The chances of Robert Ayling, CEO of BA, being as successful as his predecessor,
Sir Colin Marshall, are greatly reduced.
Adaptive Incrementalism
The Spanish firm Finanzauto the distributor of Caterpillar products
and a division of the Barlow Group is an example of a successful adaptive
incrementalist turned around. The division's management had a lot of time
to bring about change and the resource of support from its head office.
As a result they were able to apply control systems used in other parts
of the organisation without having to create new knowledge.
Essentially the market conditions and the change steps necessary had
already been identified in other parts of the world and were such that management
locally could learn from that experience. Without this knowledge existing
in the organisation and without time being available this turnaround would
have been unsuccessful.
Creative Incrementalism
In its Canadian subsidiary in Barrie, Volkswagen attempted a controlled
revolution by having management sit through many courses and seminars on
the change process over a period of five to six years! These courses introduced
them to the existing technology of change within the organisation without
challenging them to create the environment or culture where new knowledge
could be created. In reality the management were asked to apply concepts,
that had worked in other parts of the world under stable conditions, to
a rapidly changing market and organisational environment. The pressure within
Volkswagen to become more market driven was made acutely aware to the Canadian
management. They were unable to cope, failed (showing losses over the last
five years of operations) and were eventually sold by head office.
The new owners, AWI a British firm turned the business around
in eight months. The emphasis shifted to incremental creativity. Whilst
the management were au fait with all of the latest change technology they
had never been given the opportunity to think through it, blend it, redefine
it and add to it in their own environment. Possibly because the course and
seminar leaders operated under typical "Technology of Change"
conditions never questioning the hidden assumptions of the technology.
This is what they were allowed to do and they quickly changed the organisation.
Timing
These examples tend to ignore the question of timing. A decision of change
has to be "timed" to the readiness of the organisation its
people to not only accept change but to embrace a new reality. A new
reality which will probably redefine the context of the business. In the
case of Volkswagen, Barrie the new reality was not possible because the
management could not identify with it. In the case of Finanzauto the new
reality was so close to the existing reality that it was not difficult to
accept, adapt behaviour and change the organisation. Frankly the change
decision has a stronger chance of implementation if the new reality is not
at odds with the present reality. Revolutionary change requires a sharp
redistribution of the new reality and for this reason revolutionary change
almost always fails. If the proposed change is too extreme one runs the
risk of having employees playing an unreal game. Radical revolutionary change
is possible but only if the ground has been carefully prepared.
In preparing the ground for change, many executives think that two days
locked away in a hotel in the mountains is sufficient. Two/three days in
the mountains reviewing the situation, searching the alternatives, and a
commitment to a new mission are not a difficulty. The decision itself to
change especially if shared is achieved quickly (sharing the decision does
run the risk of diffused responsibility).
However it's afterwards that it becomes a nightmare because behaviour
tends not to be reshaped overnight but rather in slow determined moves.
It is possible to achieve change within short controlled periods rather
than to aim to change over the next five years, provided that in short slots
you change very little, but you have the sensation of change and momentum
to build up on ongoing achievement. In the example of AWI Canada taking
over a subsidiary of Volkswagen the new management found an embedded large
company mentality, lots of report writing and a sense of waiting for instructions.
This business had consistently lost money over a number of years without
ever seeming to be able to break out of loss making behaviours.
One thing was clear, the existing management team had become victims
of an environment over which they felt they had little control. What added
to this was the number of "solutions" provided by Head Office
in the form of change courses, seminars and three day retreats (with and
without gurus) which promised a lot but delivered very little, only continued
losses. The approach of new management was simple setting up the medium/long
term objectives/"vision", searching through capabilities and key
resources didn't take long they set about slowly building and reshaping
those capabilities into the team. In 100 day slots day by day
getting little things done, achieving, winning this business showed
its first profit after only eight months. With hindsight this did not seem
a great achievement, but it now turned in profits. Here's the crunch this
was exactly the same team that had made the losses.
Vision
There is much discussion about this "new reality" needing to
be accompanied by a "vision". There are sufficient examples of
success without a clear and simple vision to suggest that not every leader
needs a "vision" nor needs to articulate it if he or she has one.
Often change in a business is a fulfilment of the vision of a predecessor
or a more senior executive. In Hewlett Packard Barcelona out of a series
of different general managers who built this business into a billion dollar
business only one of the GM's had been identified by his colleagues
as being "visionary". The others are really very effective implementors
of a more or less common perspective of the future of the business. For
that business to prosper it has not seemed necessary for each new general
manager to be having "visions" in order to motivate and guide
his personnel.
Conclusion
OCPs are better handed when management and employees are able to adapt
their mindsets. While many writers imply that changing mindset is relatively
easy, experience suggests that change is more likely when:
-The OCP creates serious danger to the organisation.
-The emotional issues involved in changing mindset are taken into account.
-The OCP is identified early, dealt with early and without falling into
the traps of technology of change issues.
If anything this author believes that it is not the decision that is
the most critical aspect, rather it is the preparation for that decision
and its subsequent implementation. |
